Valve export, a key element in the trade pattern.
Valves, as the "throat" parts in the industrial field, play an irreplaceable key role in many industries, such as petrochemical industry, electric power and energy, water supply and drainage, etc. From the high-pressure valves of deep-sea oil and gas exploitation to the fine regulating valves of urban water supply system, from the high-temperature steam valves of thermal power stations to the corrosion-resistant special valves on chemical production lines, it is everywhere, controlling the precise flow direction and pressure adjustment of fluids and ensuring the safe and efficient operation of various industrial facilities.
In the grand map of international trade, the valve is a decisive "chess piece". The process of industrialization and the demand of infrastructure construction in countries all over the world have spawned a large-scale and continuously growing valve market. According to authoritative data, in recent years, the transaction scale of the global valve market has steadily increased at an average annual rate of [X]%. As the three core consumption regions, Asia, North America and Europe have absorbed more than [specific proportion] of valve products. China, with its complete manufacturing system and advanced technology, has become a key force in valve export, and its products are exported to many countries and regions around the world, injecting a steady stream of "China power" into the vigorous development of world industry.
Trade War Haze: Heavy Tariff and Market Turbulence
(A) tariff barriers, soaring costs
Since the outbreak of Sino-US trade friction, the US government has flagrantly waved the tariff stick and imposed high tariffs on the valve products exported from China, just like a sudden "storm", which has cast a heavy shadow on the export road of China valve enterprises. Take the common industrial valves as an example. Before the trade war, the valve products exported to the United States were quite competitive in price by virtue of the cost advantage brought by China's complete industrial chain, and could provide reliable quality for American customers at a relatively low price. However, with the landing of several rounds of tariff increase measures in the United States, the tariff rate once climbed to [specific tax rate], which directly made the landing cost of valve products jump sharply. The original cost of a valve was [X] dollars. After the tariff was added, the cost instantly increased to [X+tariff increase] dollars. For many China valve enterprises with meager profits and controlled by scale and cost, this is undoubtedly a heavy blow. The profit space of enterprises has been sharply compressed, and the profit rate of many enterprises has plummeted from [X]% which was still sustainable to the brink of loss, and even some small enterprises have directly fallen into the difficult predicament of more production and greater losses.
(B) market fluctuations, orders dropped sharply.
Under the heavy pressure of tariffs, the demand side of the US market also fluctuated violently, which led to a sharp decline in the order quantity of China valve enterprises. On the one hand, the transfer of tariff cost has greatly increased the cost for American buyers to purchase China valve products. In order to control the cost, they have to cut down the order size or turn their attention to other alternative producing areas with relatively low prices. According to relevant data, during the [specific time period] after the outbreak of the trade war, the order value of valves imported from China in the United States decreased by [X]% year-on-year, and many large-scale procurement projects were suspended or postponed. For example, a large petrochemical enterprise in the United States originally planned to purchase a batch of special valves worth [X] million dollars from China for the construction of new production lines. Due to the impact of tariffs, the purchase cost exceeded the budget, and finally chose to shelve the order and turn to local suppliers for high-priced alternatives. On the other hand, the market uncertainty caused by the trade war has made American enterprises more cautious in investment decisions, and a large number of industrial projects have been postponed or scaled down. As a supporting product, the demand for valves has naturally shrunk dramatically. Many China valve enterprises have reported that the orders of American customers who have been cooperating steadily in the past have dropped precipitously, and some enterprises have even reduced their export orders to the United States by as much as 70%. The production line in the workshop is under-started and the production capacity is idle, which has become the norm, and the operation of enterprises is facing unprecedented severe challenges.
Industry Change: Struggle and Transformation under Challenges
(A) the plight of traditional enterprises
In the storm of trade war, many traditional valve enterprises are caught in the double "mire" of rising costs and decreasing orders, and their operating conditions are in jeopardy. On the one hand, the rising cost of raw materials, such as steel, copper and other basic raw materials, fluctuated frequently during the trade war, and the increase was as high as [X]%, which made the basic cost of valve production soar like a kite out of control; At the same time, with the optimization of the domestic employment environment and the changes in the supply and demand structure of the labor market, the labor cost is increasing at a rate of nearly [X]% every year, further increasing the burden on enterprises. On the other hand, the sharp drop in overseas orders has left a large number of production lines in enterprise workshops idle, and the capacity utilization rate once fell below [X]%, and the fixed cost shared by unit products increased sharply. Many small valve enterprises have a tight capital chain to the limit, and even have no choice but to stop production. The once busy and noisy factory area is now silent and overgrown with weeds, facing a severe test of life and death.
(2) The road to transformation has begun.
However, there is light under the predicament. Some far-sighted valve enterprises have resolutely embarked on the road of transformation and turned challenges into opportunities. They increased investment in research and development, and made every effort to March into the field of high-end intelligent valves. Take a well-known valve enterprise as an example, the proportion of R&D investment in its operating income has jumped from [X]% before the trade war to [X+increased proportion]%, and a scientific research team led by senior engineers and industry experts has been set up to focus on solving key technical problems of intelligent valves. After numerous tests and improvements, we have successfully developed a series of high-end valve products with intelligent functions such as remote monitoring, automatic adjustment and fault warning. Once these products were launched, they quickly emerged in high-end fields such as petrochemical industry and intelligent buildings, and won a large number of new orders. According to statistics, within a short period of one year after the transformation, the order amount of high-end intelligent valve products increased by [X]% year-on-year, which successfully rose against the trend, not only filling the traditional order gap lost due to trade war, but also opening up a broader and profitable new market space for the enterprise, becoming a model benchmark for the transformation and development in the industry.
The light of breaking the game: multiple strategies and emerging opportunities
(A) to explore new markets
Faced with the dilemma of trade war, many valve enterprises have turned their attention to overseas emerging markets and actively explored new growth paths. Southeast Asia, with the booming wave of infrastructure construction, has become the "favorite place" for many enterprises. According to the relevant data, in recent years, the infrastructure investment of the member countries of the Association of Southeast Asian Nations (ASEAN) in the fields of energy, water supply and chemical industry has increased at an average annual rate of [X]%, and the demand for valve products has risen. China valve enterprises have keenly grasped this business opportunity and increased their market expansion in this region. For example, a well-known valve company set up a localized sales and service team in Thailand to deeply understand the needs of local customers. In view of the frequent floods in Thailand, it specially developed a series of large-caliber butterfly valves with super drainage capacity and corrosion resistance, and quickly won a large number of orders in local water conservancy projects and urban drainage system projects, and its market share increased from almost zero to [X]% in just one year, and it successfully gained a foothold; With the help of the "One Belt, One Road" initiative, some enterprises have cooperated closely with the engineering projects of countries along the route, and their products have entered emerging markets such as the Middle East and Eastern Europe, and their export territory has been continuously expanded, effectively offsetting the loss of falling orders in the US market.
The European market also contains great potential. With the continuous promotion of energy transformation and industrial upgrading in European countries, the demand for high-end intelligent valves is growing. Some valve enterprises with technical strength in China have made precise efforts to knock on the door of European market with high-quality products. Taking Germany as an example, as a strong manufacturing country in Europe, its requirements for the quality and technical standards of valve products are extremely high. Through years of technical research and development, a high-end valve enterprise in China has successfully developed an intelligent control valve that meets the German Industry 4.0 standard, and obtained the certification of TV Rheinland, an authoritative certification institution in Germany. With its excellent performance and relatively affordable price, its products have quickly entered the high-end fields such as German chemical industry and electric power, and established long-term cooperative relations with many large German enterprises. The annual export volume has increased by [X]% for two consecutive years, which has opened up a new world in the European market and won the recognition and praise of China valve products in the international high-end market.
(2) Digging deep into domestic demand
When the international market is blocked, the vigorous development of the domestic market provides a solid "safe haven" for valve enterprises. In recent years, the country has vigorously promoted new infrastructure projects, covering the construction of 5G base stations, UHV power grids, intercity high-speed railways and urban rail transit, etc. These large-scale infrastructure constructions are like powerful engines, driving the domestic demand of valve products. It is estimated that all kinds of valve products required for the cooling system and power supply system of 5G base station construction alone will bring more than [X] billion yuan of new market demand to the valve industry every year; In the field of urban rail transit, the construction of a medium-sized subway line, from the ventilation system, water supply and drainage system to the process pipeline of the depot, requires thousands of sets of valves, worth tens of millions of yuan.
Valve enterprises seize this historical opportunity and deeply integrate into the domestic industrial chain. For example, an established valve enterprise has established close cooperative relations with many large domestic construction central enterprises, and customized exclusive valve solutions for its high-speed rail stations, data centers and other projects. Aiming at the complex ventilation and air conditioning system of high-speed railway station, a series of air valves with accurate air volume adjustment and low noise operation are developed. In order to meet the strict requirements of the data center for the stability of the cooling system, and to create a temperature control valve with high reliability and intelligent joint control, with the advantages of localized service and rapid response mechanism, the company has deeply rooted in the new domestic infrastructure market, and its revenue has achieved a steady annual growth of [X]% in the past three years, successfully getting rid of the haze of trade war and moving towards a new development journey driven by domestic demand.
Future Outlook: Striving for Progress in Change
Looking back on the course of Sino-US trade war, its impact on the valve export industry can be described as "magnificent", and the pain caused by tariff barriers and market fluctuations is unforgettable. However, the crisis coexists. Under the difficult situation, China valve enterprises, with their perseverance and keen market insight, actively explore the diversified ways to break the situation, expand territory in emerging markets, dig deep opportunities in domestic demand and rebuild their competitiveness through technological innovation.
Looking forward to the future, the global industrial structure continues to evolve, and the opportunities and challenges of the valve industry are intertwined. On the one hand, countries' demand for infrastructure construction, energy transformation and industrial automation upgrading will continue to be released, creating a broad market space for valve products; On the other hand, the shadow of trade protectionism still exists, and technological competition is becoming increasingly fierce. Only by unswervingly taking the road of innovation-driven, quality-first and market diversification, continuously increasing R&D investment, upgrading the level of intelligent and high-end manufacturing, and deeply integrating into the global industrial chain, can China valve enterprises stand firm in the stormy waves of the international market, continue to write the glorious chapter of China's valve export, and bravely March towards the goal of becoming a global valve manufacturing power.